Management Buyouts: Trust issues

The dilemma is this: the boss has the inside perspective on the value of the company

Intel: against discretion

Progress in phones will be slow but the chipmaker can afford to keep trying

Lloyds and RBS: fashion statements

Dividends differ but trends at two banks are similar

Japanese banks: squeezed

Loan demand is unlikely to pick up quickly as companies could fund growth with cash reserves

Iberdrola/UIL: rebound relationship

Utilities should enjoy the wedding, but they will need to work at the marriage

US stocks: discount warehouse

The discount rate on US equities looks very low

WPP and ComScore: measure for measure

The shift to digital ads poses a challenge

AIA: clarity and opacity

The insurer is clear on the positives, but needs to give more detail elsewhere

Standard Chartered: Sands of time

Days runs out for the chief executive

TSB: baggy trousers

The bank’s clothes are too big and it may struggle to grow into them

  • Banks: HSBC vs TSB – does scale matter?

    HSBC is struggling to make the big, global banking model work. Earlier this week it cut its return on equity targets. Does TSB, a niche UK retail bank, have a better business model? Or is it impossible for banks of any size to make decent returns? Join us at midday UK time for a Lex live discussion

  • Amazon: In its own words

    Amazon’s free cash flow looks great – from a distance. On close inspection, the ecommerce company’s use of capital lease obligations obscures the vast scale of its capital expenditure, This in turn makes free cash flow look much rosier than it would if the true costs of running the business (such as principal repayments on capital lease obligations) were to be included.

    For starters: Amazon’s use of capital lease obligations has been increasing a lot:

  • In Defense of Fanuc

    At Lex, we always have a soft spot for those readers who agree with our views. Thursday’s Lex regarding Dan Loeb’s Third Point and Japan’s Fanuc attracted these comments from Jean Medecin, member of the Investment Committee at Carmignac Gestion, an investor in Fanuc. Carmignac have €50bln AuM.

    As long term investors of Fanuc we have always focused on assessing the company fundamentals rather than chasing the shadows of corporate actions. So far we can only rejoice at Fanuc’s performance.

  • Sky and BT: own goal?

    Tuesday night’s result on television broadcast rights for the English Premier League caught everyone off-side. Both sides appear to have overpaid at £5.1bn (£3bn prior), which strongly suggests that the value of sports content, or at least for European football, has not yet peaked.

    Sky will pay £4.2bn for the rights to televise 126 games per season from 2016/17, 83 per cent above what it paid previously. Sky not only protected its valued Sunday slots but also took care to gain as many first picks on Saturday as well. BT paid up, lifting their own payments by 30 per cent, though arguably for less. It receives less Bank Holiday slots, which Bernstein notes historically receive higher viewing numbers. Moreover, it will have fewer ‘first picks’ on which games to televise than before (12 vs 18). Their chances of showing the most popular games falls, and they have paid more. Hmmm, no flag?

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